Question
7.60 Peterson Pipes prepares detailed budgets for all four quarters of the year. The following information pertains to Petersons budget for 2009: Revenues Direct Labor
7.60 Peterson Pipes prepares detailed budgets for all four quarters of the year. The following information pertains to Petersons budget for 2009:
|
Revenues |
Direct Labor |
Materials purchases |
Beginning materials inventory | Beginning finished goods inventory |
First quarter | $795,200 | $240,000 | $235,000 | $400,000 | $380,000 |
Second quarter | 834,200 | 244,500 | 211,200 | 420,000 | 390,400 |
Third quarter | 864,450 | 238,500 | 222,300 | 415,000 | 385,600 |
Fourth quarter | 856,250 | 248,600 | 207,500 | 425,000 | 391,250 |
First quarter, 2010 |
|
|
| 410,000 | 396,500 |
Peterson expects fixed manufacturing overhead to be $150,000, $172,250, $169,250, and $174,300 for quarters 1 through 4 of 2009, respectively. Likewise, Peterson expects fixed selling and administrative costs to be $80,000, $95,000, $106,000, and $100,000 for quarters 1 through 4, respectively. Peterson does not incur any expenditures related to variable overhead or any variable selling and administrative costs. Finally, Peterson plans to begin and end each quarter with zero work in process inventory.
Prepare a budgeted contribution margin income statement for Peterson Pipes for each quarter of 2009.
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